Dissertation: The Commitment Credibility of Public-Employee Pensions
My dissertation concerns defined-benefit pensions for public employees. A lack of national regulation has facilitated localized influence in plan policies, creating a real potential for underfunding and unsustainable growth. Maintaining pension promises while keeping governments functioning effectively is one of the fundamental policy challenges of the 21st Century. How does split authority between elected officials and quasi-independent management-boards contribute to variation in plan governance and the ultimate provision of public goods and services?
Though elected officials have the final say over pensions, boards of trustees also influence plan governance. Not a great deal is known about boards or how they shape policies. Boards are composed of politically and non-politically appointed members, as well as active and retired employees. Plan active-employee size turns out to be the best predictor of membership, suggesting that employee voice expands as plans cover more workers. Using both fixed effects and instrumental variables approaches, I show how boards shape plans' policies and funded levels. Active and retired members shape discount rates, while active membership is positively associated with funded ratios. Interestingly, gridlock is also associated with higher discount rates. However, I find that plans' actual investment returns are poor predictors of expected returns, irrespective of board composition. While boards offer a venue through which states can manage funds, they are not suited to solving pensions' governance challenges alone.
While the payment of pension benefits is mandatory, states do not have to make their Annual Required Contributions (ARCs) into funds. I ask what factors are associated making these payments. Politicians appear especially committed to making payments into plans covering police and fire employees. They also make smaller contributions when pensions' other two revenue streams increase: investment returns and employee contributions. Thus, politicians prefer not to devote money to pensions when possible. However, they do commit to pensions when it is politically expedient, as is the case when demonstrating support for police and fire employees.
"Should I Stay or Should I Go: Public-Employee Pensions and Retirements." Deferred pension income ought to encourage public employees to remain in their jobs for long and predictable periods of time, stabilizing retirement rates. However, it is unknown if and how pensions actually do that. This article uses new data on service retirements collected from numerous state-employee plans between 2001 and 2019 to examine this key element of the relationship between pensions and personnel. The results indicate that greater employee contributions are associated with more retirements. There is some evidence that retirements increase as other plan policies, such as early retirement bonus annuities, become more generous. Thus, pensions do matter for retirements, though in complex and multi-faceted ways. As states reform pensions to curb rising costs, they should keep pensions' personnel impacts in mind.
We develop and assess an elite-information account of representation. Politicians face uncertainty about voter opinion, and use previous vote-margins to gauge future electoral outcomes. Losses in vote support elicit ideological moderation given new information about electorates. To test this account, we use rain around Election Day as a natural experiment in voting in U.S. House races from 1956 to 2008. We find each additional inch of rainfall exogenously dampens Democratic vote-margins and shifts incumbents rightward in subsequent Congresses. We find responsiveness mainly in competitive districts, and by Democrats rather than Republicans, suggesting a party asymmetry in representation. Overall, we highlight the importance of elite information uncertainty in the electoral connection, and show that idiosyncratic electoral effects can meaningfully impact legislative behavior.
Using publicly available data on campaign disbursements, we examine gender gaps in staffing and compensation for congressional campaigns between 2010 and 2016.We find significant differences in both staff representation and pay on the basis of gender. Women make up a lower proportion of campaigns' staffs, on average, and receive less compensation overall than their male counterparts. These disparities are present across a wide variety of campaigns, but are exacerbated by partisanship, candidate gender, and incumbency status. We find that staffing and wage gaps are larger for Republican candidates, male candidates, and challengers. These findings provide new insight into distinctions in the political networks between Democrats and Republicans and the pipeline of future political candidates.